HMRC removes tax breaks on Double-Cab Pickups

February 15, 2024

HMRC removes tax breaks on Double-Cab Pickups

Thanks to a recent article from Nuvo Accountancy (Changes to the Tax Treatment of Double-Cab Pickups) it has been confirmed that HMRC will be no longer allowing double-cab pickup trucks to be classed as a commercial vehicle for benefit-in-kind (BIK) purposes and as such will be classed as a car. HMRC have stated “This is because typically these vehicles are equally suited to convey passengers and goods and have no predominant suitability.”

What are the new implications?

As yet HMRC are going to provide more clarification but as it stands today, a double-cab pickup is classed as a van when it comes to tax. This means they qualify for plant and machinery tax relief. For company car tax payers they currently qualify for a fixed-rate van benefit when the vehicles are provided to employees for personal use.

From the 1st July 2024 it is understood that HMRC will be treating these vehicles the same way as cars. This means unless they are electric, they will not be eligible for the 100% tax offset in the 1st year.

As a company car, double-cab pickups will no doubt be based on the same system as cars; fuel type and emissions. For both the employer and employee, this will result in higher costs.

HMRC have not yet clarified the VAT situation on double-cab pickups although they have said “HMRC will no longer interpret the legislation that defines car and van for tax purposes in line with the definitions used for VAT purposes.”

What happens to existing contracts or ownership?

HMRC have put transitional agreements in place meaning that any vehicles purchased or leased before the 1st July 2024 (or contracts have been entered into before 1st July 2024 but delivered afterwards) will be able to rely upon the original treatment until the earlier of disposal, lease or expiry or 5th April 2028.

More Information

If you are currently looking at taking a double-cab pickup truck, please do not hesitate in getting in touch with the team on 01332 290173 or by using the ENQUIRY FORM at the bottom of this article.

If you are looking for tax advice on your current or any future vehicles, we would highly advise to speak to your accountancy service.

There are so many circumstances where you may need that flexible vehicle, just call the team on 0330 330 9425 to see how we can help you!

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